’09: A Good Year for Debt Consolidators, Cell Phones

You can tell a lot about what kind of year 2009 was just by looking at who increased and decreased ad spending the most.

For instance, a company called the National Mortgage Center, which claims to help consumers avoid foreclosures, boosted its ad spend to $17.2 million from about $40,000 in 2008, a 430-fold increase. Money4Gold also logged a big jump in ad spending, as did Freedom Financial Network, a marketer that purports to help consumers manage their debt.

The data, released by the Nielsen Co. this month, connect the dots for a year in which overall U.S. advertising spending fell 9 percent, to $117 billion. But that estimate was actually better than originally predicted. For the first half of 2009, spending was down 15.4 percent over the same period in 2008. Things picked up considerably in the fourth quarter. (Nielsen’s estimates don’t include online ad spending. According to the Interactive Advertising Bureau, such spending was estimated at $10.9 billion, a 5.3 percent decline from the same period in the previous year. The IAB’s full-year 2009 figures aren’t out yet.)

The softness at the beginning of the year is one reason why there were so many new direct response advertisers like Cash4Gold, said Sam Catanese, chief executive of the Infomercial Monitoring Service of Broomall, Pa. Catanese said that since so many major advertisers pulled back on spending in early 2009, there was a lot of cheap TV airtime. “The first quarter was strong,” Catanese said, referring to 2009. But Catanese added that in each subsequent quarter, rates went up again, and time became scarcer. As for 2010: “Q1 seems to be strong again. I feel we’ll be up and swinging.”

Obviously, those that did drop cash on ads didn’t spend enough to make up for a shortfall left by major categories like autos, which cut its spending 23.4 percent to $8 billion in 2009, per Nielsen. In fact, even total spending for direct response fell 4.5 percent during the year, to $2.5 billion.

Of the 10 top-spending categories, only three—pharmaceutical, fast food and department stores—wound up with a larger ad outlay than the year before—and only then by modest levels (1.8, 1.3 and 2.8 percent, respectively).

Amid the gloom of austerity, however, tech emerged as a notable bright spot. Hulu, a streaming-video venture among NBC Universal, News Corp. and The Walt Disney Co., logged a $48.4 million ad spending increase, a huge jump over the previous year.

But the biggest mover was the cell phone category. While wireless service providers cut their ad spend by 8.2 percent to $3.4 billion, spending on cell phone advertising jumped 120 percent to $783.6 million, as Google introduced the Android platform, a viable competitor to Apple’s iPhone and Research In Motion’s BlackBerry smartphones. Motorola joined these big spenders because it had several new models to market. “2009 was a pivotal year for Motorola,” said rep Jennifer Weyrauch-Erickson. “The company launched its first set of Android-powered devices, Cliq with Motoblur and Droid. To support this effort, we initiated a global marketing program to further strengthen the brand by differentiating our products and demonstrating their benefits for consumers. That is why you saw a significant increase in spend.”

Other categories, meanwhile, seemed to be capitalizing on recession-driven trends. The “food wraps, foils and bags” segment, for instance, hiked its advertising outlay 56.1 percent as more consumers began brown-bagging office lunches to save money. A jump for the detergent category may have been a response to frugal consumers purchasing fewer new outfits and looking to instead take better care of clothes they already own.